Welcome to another edition of the REALTOR® Report! You may recall that last month I reported the largest sales volume since September 2022, which was consistent with sales volume throughout California. So what’s your guess on June’s sales? If you guessed another record month, you’d be right! June’s sales volume for Southwest Riverside County was over $522 million, and almost $26 million more than May 2023!
We are up in all areas month over month, including sales and median price. This is excellent news, but the market is still challenging for many, including REALTORs®. Inventory remains tight, which is driving competition among buyers. After 10 consecutive rate hikes dating back to March 2022, the Feds did not increase rates in June. Good news for now, but it’s already being assumed that there may be 1-2 additional increases in 2023. For now, we just have to wait and see.
Let’s take a closer look at the numbers for our region from June 2023.
The median home price in Southwest Riverside County increased 5% from the previous month ($615,000/$588,000) and is flat from a year ago ($615,000). Comparing the median price to where it was 2 years ago, it has increased by 11.8% when the median price was $550,000. Unsold inventory remained at 3 months (6 months is considered a healthy market), and the median time on the market continues to decrease, dropping by 20% to 12 days. This is up from 10 days last year and significantly higher than 2 years ago when it was just 6 days. Unit sales increased by 7% from last month but are still down 19% from last year. Unsold inventory increased from the previous month by 12% but is significantly down from last year, with a decrease of 38%. Median prices remained relatively flat in our local cities, with a total median price variance from -5.7% to 8.6%.
New residential home construction is booming and is a big help to our shortage in inventory. Many buyers are also turning to new construction to fight off some of the competitiveness of the resale market. I want to point out that the same advantages of using a REALTOR® when purchasing a resale home apply to new construction.
There are two things that I am happy to report on when it comes to legislation in the housing arena. Back in May, thousands of REALTORs® went to Sacramento and urged our legislators to allocate more funding towards the California Dream For All program. As a reminder, this program was initially allocated $500 million to aid with down payment assistance throughout the State. However, when Governor Newsom made some budget cuts, $200 million from this program was removed. Additionally, the program was anticipated to last several months but ran out of money in just 11 days.
I am happy to report that with the newly signed budget, the $200 million that was taken away has been reallocated back to the program! It remains unclear when and how the additional funds will be available, so I encourage potential buyers and REALTORs® to stay in close contact with your lenders to take advantage of this program. This is another example of the power of the REALTOR® community advocating for current and future homeowners throughout California!
Another bill that I received a lot of questions on is SB 584 (Limón), which would have imposed a 15% tax on renters of short-term rentals. Even though some of our local cities have bans or restrictions on short-term rentals, their impact on tourism, the medical field, and even victims of wildfires and other natural disasters, along with providing homeowners a way to earn money from their homes or ADUs was essential to our State Association. We were an early opponent of this bill, and due to our lobbying efforts paired with other groups, the author pulled the bill from its scheduled hearing. That doesn’t mean it can’t come back in the future, but our efforts were heard once again, which is another victory for us.
While many bills failed to make it out of their house of origin, I am still tracking 35 bills that affect real estate. It’s a mix of support and opposition, and we will remain hard at work through the end of the legislative cycle. As always, if there is a particular bill of interest you have questions about, don’t hesitate to contact me.
I hope I have covered everything that affects you and your business. Please let me know if I left anything out or if you need anything explained further.
As always, I am available if you have any questions about the report. Until next month…